S&P 500 · January 8, 1988
Aftershock of Black Monday
-6.77%
single-day change vs previous close
Part of a longer stretch
Back from Black Monday
early in it · 1987-12-04 → 1989-07-26, +50.97% over the whole period
What happened that day?
- 8 January 1988 — S&P 500 fell 6.77%, three months after Black Monday
- Immediate trigger was trade data: a bigger-than-expected US deficit, raising fears of a weaker dollar and higher rates
- But the size of the reaction isn't explained by the data alone
- Participants who'd watched a fifth of the market vanish in a day three months earlier still carried the fear it could repeat
- Textbook case of a market staying hypersensitive after a large event
- Fell 31.75% from peak. That low was never breached again, and the market moved into a rising phase
Sources
Every figure on this page is recomputed from the original daily closing prices and checked against them at build time. The account of what happened is written from the sources listed above.